{"id":40473,"date":"2026-01-30T13:00:29","date_gmt":"2026-01-30T05:00:29","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=40473"},"modified":"2026-01-30T13:00:29","modified_gmt":"2026-01-30T05:00:29","slug":"gold-drops-as-fed-speculation-shifts-mood","status":"publish","type":"post","link":"https:\/\/www.vtmarkets.com\/en-ca\/analysis\/gold-drops-as-fed-speculation-shifts-mood\/","title":{"rendered":"Gold Drops as Fed Speculation Shifts Mood"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"559\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/image_fx_-2025-03-24T190408.948-1024x559.png\" alt=\"\" class=\"wp-image-19121\" \/><\/figure>\n\n\n\n<p><strong>Key Points<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Spot gold fell <strong>3.9%<\/strong> to <strong>$5,183.21<\/strong>, after hitting a record <strong>$5,594.82<\/strong><\/li>\n\n\n\n<li>Prices are still up <strong>over 20%<\/strong> in January, marking the strongest monthly gain since <strong>January 1980<\/strong><\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p>Gold prices slid sharply on Friday, retreating more than <strong>4%<\/strong> at one point as rumours circulated that the next Federal Reserve chair could take a more hawkish stance. The pullback followed an aggressive rally that had pushed bullion to fresh record highs just a day earlier.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Asian investors are pouring record amounts into gold exchange-traded funds, leading some to question whether the rally in bullion is getting close to topping out <a href=\"https:\/\/t.co\/mpExEnR1cJ\">https:\/\/t.co\/mpExEnR1cJ<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/2017061352989163871?ref_src=twsrc%5Etfw\">January 30, 2026<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Spot gold was down <strong>3.9%<\/strong> at <strong>$5,183.21 per ounce<\/strong> by <strong>0323 GMT<\/strong>, after falling as much as <strong>5%<\/strong> during the session. On Thursday, prices surged to an all-time high of <strong>$5,594.82<\/strong>, underscoring how stretched positioning had become after weeks of heavy inflows.<\/p>\n\n\n\n<p>Despite the sharp decline, gold remains on track for its strongest monthly performance in decades.<\/p>\n\n\n\n<p>Prices have risen <strong>more than 20%<\/strong> so far in <strong>January<\/strong>, heading for a <strong>sixth consecutive monthly gain<\/strong> and the largest monthly advance since <strong>January 1980<\/strong>.<\/p>\n\n\n\n<p>A cautious forecast suggests that while short-term volatility may persist, the broader uptrend has not yet been invalidated.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Dollar Rebound and Fed Talk Trigger Profit-Taking<\/h2>\n\n\n\n<p>The immediate catalyst for the selloff came from renewed focus on US monetary policy leadership.<\/p>\n\n\n\n<p>President Donald Trump said on Thursday that he intends to announce his pick to replace <strong>Fed Chair Jerome Powell<\/strong> on Friday, intensifying speculation around who will lead the central bank when Powell\u2019s term ends in <strong>May<\/strong>.<\/p>\n\n\n\n<p>Market chatter that <strong>Kevin Warsh<\/strong> could be nominated weighed on gold during Asian trading hours.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">The Trump administration is preparing for the president to nominate Kevin Warsh to be the next Federal Reserve chair, according to people familiar with the matter. Read more: <a href=\"https:\/\/t.co\/Zwp1r5eN8q\">https:\/\/t.co\/Zwp1r5eN8q<\/a><br><br>\ud83d\udcf7\ufe0f: Tierney L. Cross\/Bloomberg <a href=\"https:\/\/t.co\/oaSwHP7zIf\">pic.twitter.com\/oaSwHP7zIf<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/2017064595383255379?ref_src=twsrc%5Etfw\">January 30, 2026<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Traders interpreted the possibility of a less dovish Fed chair as <a href=\"https:\/\/t.co\/mpExEnR1cJ\" target=\"_blank\" rel=\"noopener nofollow\" title=\"\">a risk to bullion<\/a>, particularly after the metal entered overbought territory following its recent surge.<\/p>\n\n\n\n<p>The pullback also coincided with a rebound in the US dollar from multi-year lows. A stronger dollar tends to pressure gold by making it more expensive for overseas buyers, adding to the incentive for short-term profit-taking.<\/p>\n\n\n\n<p>US gold futures for <strong>February delivery<\/strong> fell <strong>2.7%<\/strong> to <strong>$5,176.40 per ounce<\/strong>, reflecting the broader shift in near-term sentiment.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Rate Expectations Still Support Longer-Term Demand<\/h2>\n\n\n\n<p>Even as the dollar stabilised, the broader macro backdrop remains supportive for gold. Markets continue to price in <strong>two interest rate cuts in 2026<\/strong>, suggesting that policy is still expected to ease over the medium term.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Fed leaves rates unchanged, sees &#39;somewhat elevated&#39; inflation and stabilizing job market <a href=\"https:\/\/t.co\/SFguKu5cgw\">https:\/\/t.co\/SFguKu5cgw<\/a> <a href=\"https:\/\/t.co\/SFguKu5cgw\">https:\/\/t.co\/SFguKu5cgw<\/a><\/p>&mdash; Reuters (@Reuters) <a href=\"https:\/\/twitter.com\/Reuters\/status\/2016656316597408024?ref_src=twsrc%5Etfw\">January 28, 2026<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>The Federal Reserve\u2019s decision earlier this week to leave interest rates unchanged helped underpin the dollar, but it did little to dismantle the longer-term case for gold as a hedge against policy uncertainty and economic strain.<\/p>\n\n\n\n<p>Geopolitical risks also remain unresolved, keeping underlying demand intact even as speculative positions adjust.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Technical Analysis<\/h2>\n\n\n\n<p>Gold (XAUUSD) came under sharp pressure, tumbling <strong>2.82%<\/strong> to <strong>5226.38<\/strong>, with a steep intraday fall of <strong>151.57 points<\/strong>. After failing to sustain above the <strong>5246.33<\/strong> high, a wave of aggressive selling broke below successive moving averages, culminating in a session low of <strong>5150.93<\/strong>.<\/p>\n\n\n\n<p>This sharp drawdown appears to have exhausted selling momentum in the short term, triggering a solid rebound back above the <strong>MA5 (5225.81)<\/strong> and <strong>MA10 (5222.64)<\/strong>.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/image-33-1024x474.jpg\" alt=\"\" class=\"wp-image-40474\" \/><\/figure>\n\n\n\n<p>Despite the selloff, the recovery from the lows has been orderly, supported by steady volume (<strong>VOL: 42.00<\/strong>) and a return above the <strong>MA20 (5218.80)<\/strong> and <strong>MA30 (5207.67)<\/strong>.<\/p>\n\n\n\n<p>However, upside remains capped below the earlier high, and the price is approaching a confluence of short-term resistance.<\/p>\n\n\n\n<p>If bulls manage to consolidate above <strong>5226<\/strong>, a retest of the <strong>5246<\/strong> zone is possible. Failure to hold this region may renew downward pressure, especially if the broader risk sentiment remains cautious.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Short-Term Outlook<\/h2>\n\n\n\n<p>Gold\u2019s sharp pullback reflects how sensitive the market has become to shifts in Fed expectations after an exceptional rally.<\/p>\n\n\n\n<p>Hawkish speculation and a firmer dollar have prompted traders to lock in gains, but the metal\u2019s broader monthly performance highlights persistent demand for safe-haven assets.<\/p>\n\n\n\n<p>Near-term price action is likely to remain volatile as markets digest the Fed chair announcement and reassess dollar direction. While further downside cannot be ruled out after such a steep run, the structural drivers behind gold\u2019s surge have yet to fully fade.<\/p>\n\n\n\n<p><strong>Learn more about trading <a href=\"https:\/\/www.vtmarkets.com\/precious-metals\/\" target=\"_blank\" rel=\"noopener\" title=\"\">Precious Metals<\/a> on VT Markets <a href=\"https:\/\/www.vtmarkets.com\/Insights\/\" target=\"_blank\" rel=\"noopener\" title=\"\">here<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Gold slides after record highs as hawkish Fed speculation lifts the dollar, though the metal remains on track for a historic month.<\/p>\n","protected":false},"author":64,"featured_media":19121,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[31],"tags":[6,13],"class_list":["post-40473","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-gold","tag-precious-metals"],"acf":{"acf_article_selection_author":""},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/40473","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/64"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=40473"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/40473\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/19121"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=40473"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=40473"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=40473"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}